Norway will contribute up to $50 million to the Asian Development Bank’s (ADB) Climate Action Catalyst Fund (CACF), an innovative carbon fund launched under Article 6 of the Paris Agreement.
This announcement was made on November 20, 2024, during COP29 in Baku, Azerbaijan, marking a significant step in advancing international carbon markets, according to statement on ADB’s website.
The CACF, operational since January 2024, provides carbon finance to developing nations in Asia and the Pacific to support projects that generate tradable carbon credits under Article 6.
These credits facilitate cross-border market cooperation, potentially reducing the costs of implementing national climate plans by $250 billion annually by 2030.
ADB’s Climate Change and Sustainable Development Senior Director Toru Kubo emphasized the importance of the fund, noting that recent progress on Article 6 sends a strong price signal to the carbon market.
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Unlike traditional carbon financing, which often requires project completion before payments, the CACF offers upfront financing for emissions reduction projects.
This approach helps project owners in developing countries overcome initial funding barriers.
Norway’s Ministry of Climate and Environment Senior Adviser Malin Meyer highlighted the fund’s potential to foster private-sector investments, promoting clean energy and low-carbon projects in Asia and the Pacific.
Similarly, Sweden’s contribution of 300 million Swedish krona ($27 million) underscores growing international support for the CACF, which aims to secure over $100 million in commitments from governments and the private sector.
The CACF’s first transactions are anticipated in 2025, supporting ADB’s broader mission to achieve sustainable development across the region.
By enabling access to international carbon markets, the fund aligns with the bank’s goal of fostering a resilient, low-carbon future for its member countries.
